Citizens Financial Group, Inc. · NYSE:CFG
Citizens Financial — Barclays Global Financial Services Conference 2016
33 slides from Citizens Financial's conference presentation, Sep 14, 2016
Slide 1: Barclays Global Financial Services Conference
Barclays Global Financial Services Conference Bruce Van Saun Chief Executive Officer September 14, 2016 Exhibit 99.1
Slide 2: Important Information and GAAP/Non-GAAP Information
Important Information and GAAP/Non‐GAAP Information This document contains forward-looking statements within the Private Securities Litigation Reform Act of 1995. Any statement that does not describe historical or current facts is a forward-looking statement. These statements often include the words
Slide 3: Solid franchise with leading positions in attractive markets
Dimension Rank(2) Assets: $145.2 billion #13 Loans: $103.6 billion #11 Deposits: $106.3 billion #12 Branches: 1,200 #12 ATM network: 3,200 #8 Lead/joint lead bookrunner #9(3) Mortgage: $13.9 billion #15 nationally(6) Student: $5.5 billion Top 4 rank nationally(4) Deposits: $106.3 billion Top 5 rank:
Slide 4: Strong, clean balance sheet funded with low-cost deposits
Well capitalized with a common equity tier 1 capital ratio of 11.5%(1) on a fully phased-in Basel III basis Strong asset quality performance with net charge-offs of 25 bps(2) in 2Q16 Robust deposit franchise with $86.5 billion of core deposits(3), with 57% retail, and strong liquidity and fully comp
Slide 5: Robust product offerings and balanced business mix
Corporate Banking Commercial Real Estate Franchise Finance Asset Finance PE/Sponsor Finance Healthcare/Technology/ Oil & Gas/Not-for-Profit verticals Capital Markets Global Markets Treasury Solutions Commercial Deposit Services Retail Deposit Services Mobile/Online Banking Credit/Debit Card Wealth M
Slide 6: Leadership Team and Board
Average industry experience of 28 years Leadership Team Member Title Bruce Van Saun Chairman and Chief Executive Officer Eric Aboaf Chief Financial Officer Mary Ellen Baker EVP and Head of Business Services Brad Conner Vice Chairman and Head of Consumer Banking Stephen Gannon EVP, General Counsel an
Slide 7: Aspire to be a top-performing regional bank
Aspire to be a top-performing regional bank, delivering well for all stakeholders Colleagues Regulators Investors Communities & Society Customer-centric culture Customers
Slide 8: Executive Summary: Positioning Citizens to Investors
Executive Summary---Positioning Citizens to Investors A strong platform well positioned to drive value Good execution of plan is driving balance sheet and revenue momentum Growing revenues faster (Revenue growth(1,2)) 2Q16 vs. 2Q15 475 bps above peers Source: SNL Financial and Company filings. Peers
Slide 9: Well-controlled expenses; investing for growth
63 bps 5 bps 1,140 bps above peers (3) bps 8 bps above peers (55) bps 118 bps above peers Well-controlled expenses; investing for growth (Adjusted noninterest expense(1,2) change) With continued focus on positive operating leverage and improving returns 2Q16 vs. 2Q15 4.2% Efficiency improvement (Adj
Slide 10: Tapping our Potential
“Tapping our Potential” Phase I efficiency initiatives launched first half 2014, Phase II revenue and efficiency initiatives launched mid 2015 and Phase III revenue, efficiency and tax initiatives launched mid 2016. We are focused on continuous improvement Delivering for the customer Optimizing the
Slide 11: We are making steady progress without rate hikes
We are making steady progress without rate hikes Capturing revenue potential of franchise Using strong balance sheet and targeted hiring to grow loans Self funding necessary investments through efficiency initiatives Disciplined capital management Medium- term target 10% + low 60’s -- -- Non-GAAP it
Slide 12: Consumer Banking
Deposits $70.0 $70.5 $70.9 $70.9 $71.9 2.7% Consumer Banking $s in billions Driving revenue improvement Delivering on a multi-year targeted growth strategy Continuing to leverage “Bank Better” initiatives to drive primary household growth Utilizing segmentation strategies to attract, retain and deep
Slide 13: Platinum Status and Premier Banking client offerings
Platinum Status clients receive personalized advice and with preferred deposit and lending products & services: Personalized advice focused on saving, borrowing, and retirement planning needs Fewer fees, better rates to recognize Platinum Status Preferred service at Platinum-dedicated number Premier
Slide 14: Delivering an integrated banking and investing experience
Delivering an integrated banking and investing experience Growing advisory base Note: Data as of year end 2015. We are strengthening our wealth product capabilities and advice model Portfolio Manager Trust Officer Credit Specialist Wealth Strategist Wealth FC Clients Senior Banker Banker Trust Offic
Slide 15: Commercial Banking: Solid track record of organic growth
Deposits $22.7 $24.6 $24.6 $24.8 $25.1 10.5% Commercial Banking – Solid track record of delivering organic growth Includes Business Capital, Govt & Professional Banking, Corporate Finance & Global Markets, Treasury Solutions, Corporate and Commercial Banking Admin. Thomson Reuters LPC, ranking based
Slide 16: Optimizing the coverage model
Optimizing the coverage model: Differentiating mature versus emerging geographies Centralized portfolio management to enhance efficiency Rationalized RM/BDO roles Bringing more client solutions via our next generation of thought leadership initiatives: Reinforce product competence and “Mindset of th
Slide 17: Commercial Banking focused on gaining lead relationships
3+ Products Cross-Sold(1,2) Cash Management Penetration(1) …that results in much higher product penetration and better returns We have opportunity to increase lead bank penetration with new and existing clients… Middle Market, MCIV role with Commercial Clients(1) Sole Bank 57% Commercial Banking foc
Slide 18: Technology focus areas and benefits
Focus Areas Key Elements Leverage applications that are more open Provide for open architecture in Core banking and other systems Use standards-based Application Programming Interfaces (APIs) Move to a cloud-based Infrastructure Invest in adaptive security Change the way we work (IT ‘Clock’ speed) B
Slide 19: Digital-first customer experiences
Build digital-first, end-to-end customer experiences (‘moments of truth’) where we can differentiate Enhance digital platforms and address key mobile capabilities most important to our customers Enable our colleagues with new or improved tools to provide easier ways of working Deliver in a fast, agi
Slide 20: TOP II and TOP III Programs
TOP II Program TOP III Program Revenue initiatives Target ~$50-$65 million Citizens Checkup: Launched with over 160k customer appointments booked to date Consumer Retention: Initiative underway and showing strength in deposit retention and platinum launch Middle Market Share of Wallet: Fully embedde
Slide 21: Committed to invest while delivering positive operating leverage
Committed to invest while delivering positive operating leverage and growth Shifting investments toward future capabilities; technology capital expenditures 5.1% 3.0% 2.1% 2.9% 3.3% Operating leverage Positive YoY operating leverage (%) (Adjusted revenue growth – Adjusted expense growth(1)) $ in mil
Slide 22: Prudently deploying excess capital to enhance returns
Prudently deploying excess capital to further enhance returns Periods prior to 2Q15 represent Tier 1 common equity ratios. Implied 2Q17 CET1 ratio and 2016 CCAR window implied payout ratio based on 3Q16-2Q17 SNL consensus estimates as of 9/9/16 and 2016 CCAR Plan capital actions. CET1 ratio of 11.5%
Slide 23: Key messages
Key messages We have the foundation for a great franchise, and continue to deliver progress through strong execution of our turnaround strategy Financial results continue to improve and meet expectations Not waiting for rate hikes: results improving steadily without them Good progress on strategic i
Slide 24: Appendix
Appendix 3% Citizens Financalcruptae> 2g
Slide 25: Consumer Banking initiative status 2Q16
Initiative 2Q16 Status Commentary Reenergize household growth Retail checking HHs up QoQ and YoY with new checking HH first year attrition improvements. Deposits up 3% and services charges up 5% YoY. Expand mortgage sales force Application and origination volumes up 20% and 42% QoQ with improved thr
Slide 26: Large wealth opportunity with focused strategy to pursue
Large wealth opportunity with focused strategy to pursue Source: SNL Financial and 10-Ks. Peer average includes BBT, CMA, FITB, KEY, MTB, PNC, RF, STI and USB Accelerate the growth of clients into our value proposition in order to deepen product penetration and share of wallet and drive fee income g
Slide 27: Capital Markets and Global Markets cross-sell
3+ products cross-sold Middle Market and Mid-corporate (2) Global Markets Capital and Global Markets fee income 13.8% CAGR Syndication transactions where CFG is the Joint Lead Arranger or Lead Left Arranger/Total syndication transactions. Products defined as deposits, debt capital markets, cash mana
Slide 28: Treasury Solutions fee income momentum
Treasury Solutions fee income up ~7.7% YoY in 2015 with good momentum vs. estimated 2015 industry growth of ~2.5%(1) Recent investments in platform, products and customer-facing talent providing underlying momentum Improved go-to-market strategy and client-facing model with up-tiered sales organizat
Slide 29: Non-GAAP reconciliation table
Non-GAAP reconciliation table $s in millions FOR THE QUARTER FOR THE QUARTER ENDED JUNE 30, ENDED JUNE 30, 2016 Change 2016 2015 from 2015 Noninterest income, excluding special items: Noninterest income (GAAP) $355 $360 Less: Special items — — Noninterest income, excluding special items (non-GAAP) $
Slide 30: Non-GAAP reconciliation table
Non-GAAP reconciliation table Basel III ratios assume certain definitions impacting qualifying Basel III capital, which otherwise will phase in through 2019, are fully phased-in. Ratios also reflect the required US Standardized methodology for calculating RWAs, effective January 1, 2015. $s in milli
Slide 31: Non-GAAP reconciliation table
Non-GAAP reconciliation table $s in millions, except per-share data FOR THE QUARTER ENDED FOR THE QUARTER ENDED FOR THE QUARTER ENDED FOR THE QUARTER ENDED FOR THE QUARTER ENDED FOR THE QUARTER ENDED FOR THE QUARTER ENDED FOR THE QUARTER ENDED FOR THE QUARTER ENDED FOR THE QUARTER ENDED FOR THE QUAR
Slide 32: Non-GAAP reconciliation table
Non-GAAP reconciliation table $s in millions, except per-share data
Slide 33: Citizens Financial Group, Inc.
3* Citizens Financial Group, Inc.”
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